Wealthsimple Review: Automating Your Investments for Slow and Steady Growth
Breadth of Products
Ease of Use
If you’re wondering whether automating your investment portfolio is the right decision, consider the benefits and drawbacks of Wealthsimple.
- No account minimums makes it easy for a new investor to get started
- Automatically contribute spare change
- Socially-responsible portfolios available
- Portfolio rebalancing, tax-loss harvesting and dividend reinvestment are all automatic
- Accounts are insured and protected by the Securities Investor Protection Corp up to $500,000
- Commission-free trades
- Trade crypto
- Management fees for various products --0.25% to 0.50%--are higher than other robo-advisors
- Phone support is limited to tech or account set up issues
- No physical branches
- Soft credit pull required
Wealthsimple was started by four friends out of their apartment in 2014. The company is headquartered in Toronto, Canada but has offices in London and New York.
Today, over 1.5 million Wealthsimple investors are using the platform to automate their savings and investments. Wealthsimple uses technology to automate investing and reduce the costs and fees you’d pay if you worked with a broker or investment advisor. Always innovating, it’s the first regulated crypto-trading platform in Canada.
Wealthsimple has several financial and investment products available based on the plan you choose.
To start with Wealthsimple, you’ll need to choose from three account tiers. Here’s a closer look at what you get with each plan.
Those getting started on building a nest egg should start with a Basic account. There are no monthly fees or minimums — you’ll pay a management fee that’s a percentage of your balance.
- For deposits of up to $100,000
- Automatic investing and dividend reinvestment
- Turn on Roundup through the app or website and you’ll invest pocket change each time you make a debit or credit card purchase.
- Personal and IRA accounts available
- No account minimums
- Funds invested in low-risk ETFs
- Free withdrawals
- Your savings and investment goals are on autopilot.
- Access to a custom, diversified portfolio, no matter how small the balance
- Management fee of 0.50% for investment accounts and 0.25% for savings are higher than other competitors.
- Access to a financial planner is not included.
Once you start growing your account balances, you can upgrade to Wealthsimple Black. It builds on Basic’s features but adds savings on management fees and personal financial advice to keep up the momentum on your growth.
- For deposits between $100,000 and $499,999
- Includes a financial planning session
- Reduced management fees of 0.40% instead of 0.50%
- Tax-loss harvesting helps you save on your capital gains tax liability
- You won’t lose Black status if the market dips and your portfolio’s value drops below $100K.
- You’ll be downgraded to Basic and pay a higher management fee if your balance drops below $100,000 for any other reason than a market dip.
- Financial planning sessions must be requested in advance.
Higher-net-worth individuals will be automatically upgraded to Generation once they achieve $500K or higher in deposits. Wealthsimple starts looking like a traditional brokerage at this level with personalized advice and plenty of investment options.
- For deposits of $500,000 or more
- All the features of Basic and Black
- Free access to a “dedicated team of experts”
- Includes a custom, holistic financial plan with net worth and cash flow reports and analysis, financial projections and retirement/wealth-preservation strategies
- Retirees drawing down their retirement fund can remain eligible for Generation, even if their balances drop below $500K
- Households can be eligible for Wealthsimple Generation if their combined balances add up to $500,000 or higher
- Management fee continues at 0.40%
- Wealthsimple for Advisors clients aren’t eligible
Wealthsimple is designed to put your savings and investments on autopilot. But how does the service measure up?
Having access to someone regarding your investment strategy or goals is only available for the higher tiers or through a paid session with a Portfolio Manager. However, if you have a general question about setting up your account or how Wealthsimple works, the best way to reach customer service is:
- Calling 1-855-782-3559
- Submitting a request
Accessibility and Branch Availability
Wealthsimple does not have physical branches, although it does have an office/headquarters in Toronto, New York and London.
Mobile and Digital Experience
Wealthsimple doesn’t have physical branches. All of your savings and investing will happen through the website or mobile app. Wealthsimple reviews about the app are mostly positive.
- Google Play: 4 out of 5 stars, 11,240 reviews
- Apple Store: 4.4 out of 5 stars, 666 reviews
You’ll be able to make commission-free stock and ETF trades. Most unique of all, you can buy and sell cryptocurrencies with Wealthsimple Crypto. Your money is safe — Wealthsimple uses 256-bit SSL/TLS certificate encryption to protect your data as it’s transmitted.
Where To Download the App:
How To Open an Account
To open an account with Wealthsimple:
- Apply online
- Wealthsimple will do a soft credit pull
- Upload a bank statement or check to verify your account information and routing number for funding
- Customer service phone number: 1-855-782-3559
- Weatlhsimple routing number: 071000288
The only fee Wealthsimple charges is a management fee that ranges between 0.25% and 0.50%, based on your account and deposits. Trades and withdrawals are free.
Wealthsimple vs. Competitors
Here is how Wealthsimple fares when compared to other robo-advisors.
|Wealthfront||Fully automated investment|
|Vanguard||Low management fees|
Wealthsimple vs. Wealthfront
The names are similar, but the services from these robo-advisors do have their differences, namely the human touch. Wealthsimple clients have access to humans for customer service issues and financial planning needs. Wealthfront does not offer any access to a financial planner or advisor.
Wealthsimple vs. Betterment
Both companies are a good place to get started in your investment journey. They don’t charge any fees outside of the annual account management charge or have account minimums. Betterment may be better suited for beginners — Wealthsimple’s investment platform includes access to crypto trading such as Ethereum and Bitcoin.
Wealthsimple vs. Vanguard
The biggest drawback to Wealthsimple is the higher management fee of 0.40% to 0.50%. There are no other fees, but the ETF you invest in may come with its own fees built in. You can cut back on fees by choosing Vanguard’s robo-platform named Digital Advisor, which only charges $4.50 per year for every $3,000 invested.
Growing your investments is all about the amount of time in the market. That’s why starting right away is a better strategy than waiting for the ideal conditions. Wealthsimple encourages this concept by getting rid of the minimums required to open an account and making the process of getting started simple. You can fund your nest egg with as little as $1 and automate the process to let your money work for you.
Using the Roundup feature is a great way to steadily contribute towards your fund. Every time you make a credit or debit card purchase, the app automatically rounds up the total and moves the spare change over to your Wealthsimple account.
Wealthsimple FAQHere are the answers to some of the most frequently asked questions about Wealthsimple.
- How much does a Wealthsimple trade cost?
- Wealthsimple trades are commission-free. They won't cost you any money.
- Is there a Wealthsimple app?
- Is there an account minimum to open a Wealthsimple account?
- There are no account minimums to get started with Wealthsimple. You can open an account today with a few cents or a dollar.
- Can I buy and sell Bitcoin with Wealthsimple?
- Wealthsimple allows you to trade in cryptocurrencies such as Ethereum and Bitcoin. It's one of the few robo-advisors that currently allow crypto trading.
This content is not provided by Wealthsimple. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by Wealthsimple.